Category Archives: Corporations

Indian government targets Vodafone in $7bn tax avoidance crackdown

The Indian government is to target Vodafone in a $7bn move against tax avoiding corporations. The mobile operator will be issued a payment reminder notice after a new retroactive law overturned a court decision exempting them from paying billions of pounds worth of tax.

The behaviour of Indian regulators stands in marked contrast to HMRC, who let the telecoms company off £7bn worth of UK tax for no apparent reason. Despite a Supreme Court ruling in Vodafone’s favour, the parliament has passed a retroactive amendment to tax laws to plug the loophole.

The $7bn amendment won’t hit Vodafone alone, though they are the highest profile affected company set to be hit with a bill. Their $3.6 bill dates from 2007, when they took over Indian interests in Hong Kong based company Hutchinson Whampoa. Since then they have battled the Indian government through the courts, in a scandal that led to the company’s top lawyer quitting.

Where India targets corporations, George Osborne targets charities.

What Barclays said before they confessed to tax avoidance scheme

  • Boasted of tax contributions in annual report
  • Claimed tax was “important aspect” of corporate citizenship
  • But refused to sign up to code until forced by Osborne

Despite the exposure of Barclays’ “aggressive tax avoidance” scheme — designed to save them billions of pounds over several years — it seems the bank were more than happy to brag about their position as “corporate citizens”.

In the review section of their last annual report, the bank go to great lengths to stress their societal role, including a section entitled “Total tax contribution” – which boasted of the amount of tax they pay:

“Barclays role as a corporate citizen remained a key priority … and an important aspect of this was the tax contribution made to governments in the countries in which we operate.”

In reality, the bank were dragged kicking and screaming into the so-called “voluntary” code. Despite the measure announced in June 2009, the chancellor was forced to threaten binding legistlation when only four of the top fifteen banks had signed up to the scheme nearly eighteen months later — including Barclays.

With an annual report taglined “Delivering on our promises”, there’s obviously a keen sense of irony at 1 Churchill Place.

Breakdown: What we’ve learned from phone hacking documents release

Earlier today, the Culture Media and Sport select committee published a mine of new correspondence between the committee and key players in the phone hacking scandal. Here’s what we’ve learned so far:

  • Clive Goodman wrote to News International after he was sacked for phone hacking, to make a claim for unfair dismissal. In the letter, he states that Andy Coulson was aware of the practice of phone hacking, and that it was regularly discussed in editorial meetings until “explicit reference of it was banned by the Editor.”
  • The version of Goodman’s letter provided to the committee by News International had redacted all references to hacking being discussed in editorial meetings.
  • According to James Murdoch, Clive Goodman was paid £243,502.08 in settlement of his unfair dismissal claim.  Also, approximately £246,000 was paid to Glenn Mulcaire’s lawyers to cover his legal fees.
  • The Editor and Managing Editor of the News of the World could authorise payments of up to £50,000. Deputy Editors could authorise £10,000 and Desk Heads, £2000.
  • 54 staff have been disciplined under News International’s Corporate Code of Conduct since 2000, including 3 this year.
  • While NI have records stating Rebekah Brooks was on holiday at the time the Millie Dowler story which had been sourced through phone hacking broke, James Murdoch says they do not have records showing who deputised for her, or who the on duty lawyer was.
  • Mark Lewis, Gordon Taylor’s lawyer, says he was told by a lawyer representing News International that he was “negotiating with Murdoch.” Lewis says “I did not know whether he meant Rupert Murdoch or James Murdoch at that time, but it seems likely that the reference was to James.”
  • The 2007 email review carried out by Harbottle & Lewis, far from being a full, unrestrained investigation, was restricted to five email subfolders – and only to look for evidence regarding Clive Goodman. The “limited” selection of documents were examined over a period of two weeks, by junior employees.
  • When James Murdoch the legal firm had been brought in to find out “what the hell was going on”, he may have been, say Harbottle & Lewis, “confused or misinformed.”
  • News International’s former Director of Legal affairs Jonathan Chapman told the committee the 2007 Harbottle & Lewis email review could not be characterised as the “wider internal investigation” it had been made out to be at the committee hearing. He said the attempt to do so could be said to be “a diversion.”

Have we missed anything? If you’ve found something juicy in the documents that we haven’t listed, let us know.

Murdoch wants Gove to replace half of British teachers with computers

Following up on a Political Scrapbook report from July, the new issue of Private Eye features an interesting angle on Michael Gove’s relationship with high level directors in Rupert Murdoch’s News Corporation.

Last year, News Corp purchased Wireless Generation, a company which makes teaching assistance software, and hired former New York schools Chancellor Joel Klein to head it up. In a June interview with the Times, Murdoch seemed almost giddy at the prospects made available by his new acquisition:

“You can get by with half as many teachers. The teachers can be a lot better and a lot better paid.” As well as cutting back on teacher numbers, there would be a big reduction in textbook budgets. Mr Murdoch joked that he hoped to put textbook publishers out of business.

As we reported in last month, Wireless Generation was awarded multi-million dollar no-bid contracts to provide these very systems to the New York school system. Interestingly, almost as soon as Gove had taken over the Department for Education, the government announced the abolition of BECTA – the quango which oversaw IT procurement in schools.

Klein, now in charge of NewsCorp’s post hacking clean up operation, has visited Gove’s department on two occasions, and describes the education secretary as a “friend”. Prior to the release of Gove’s media meeting lists, he was referred to on the DfE website simply as “former Chancellor of the New York City Department of Education”, without reference to his current position at NewsCorp.

Fox News anchor forgets about 9/11

Just days after filling Glenn Beck’s vacated Fox News timeslot, conservative anchor Eric Bolling has already been caught trying to rewrite the history books.

On the new panel show The Five, Bolling not only declared the US “safe” under President Bush’s leadership, he said he “didn’t remember” any terrorist attacks on the US between 2000 and 2008:

Rather than apologise unreservedly for the deadliest terror attack in American history having slipped his mind, Mr Bolling took it as an opportunity to complain about how petty it was that the “radical left” had pointed it out.

Good to know Fox hasn’t lost its taste for revisionist history with Beck’s departure.

The Times guilt-trip their readers with a cartoon of starving children

As the phone hacking scandal rumbles on to the dismay of News Corporation, there was speculation that Tory backbenchers had been primed by the whips to say that the public want MPs to move on to other issues, and Louise Mensch attempted to deflect the attention to Piers Morgan by taking quotes in his book out of context.

But the third and most tasteless prong of resistance has come from a graphic in The Times depicting children in Somalia, suggesting that talking about phone hacking has prolonged their starvation.

No one is stopping The Times covering both stories.

Pro-Lansley MP still takes cash from drug companies and private providers

Writing on Iain Dale’s so-called “mega blog”, Tory MP Nick de Bois waxed lyrical over the supposed benefits of Andrew Lansley’s market-based health reforms:

“to truly ensure patients are given a voice in the future of the NHS, we don’t need to give them a megaphone, but simply put pound signs above their heads.”

Could this callous reduction of the medical profession be linked to his private financial interests?  While de Bois was busy losing elections in 1997, 2001 and 2005, he spent his spare time as chairman of Rapiergroup, an events management company closely associated with the healthcare and pharmaceutical industries.

As The Guardian reported in May, de Bois remains a director and majority shareholder in the holding company Rapier Design Group. But telling porkies to Conservative Party officials, he claimed in his Candidate’s Declaration of Interests in 2010:

“If elected, I do not intend to continue to hold the Directorships beyond a short transitionary period.”

It’s been over a year now, and his entry in the Register of Members’ Interests still reads “Chair of Rapier Design Group”. In last year’s accounts, the company reported a turnover of £13.5m. The highest paid director — presumably de Bois — received £87,194 in emoluments and £49,120 in pension contributions.

Perhaps De Bois can explain how long this “short transitionary period” will last.

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